After years of limiting Palestinians to barely functional 2G cellular internet speeds, Israel has finally allowed local telecoms to offer 3G speeds–but old constraints remain.

[Photo: Miriam Berger]

By miriam berger5 minute Read

Business is suddenly bustling for Maher Saleh’s online food delivery service in Ramallah, the Palestinian Territories’ economic capital. A few months ago the company, called Wajbaat, had just around eight orders a day; now Saleh’s business is reaching 5o and more.

Before January, when Israel allowed Palestinian telecommunication carriers access to 3G networks in the West Bank, Saleh was glued to his office Wi-Fi in case new orders came in from Wajbaat’s website. Now the 38-year-old can work while walking or hiking with his delivery people on an app to streamline service.

[Photo: Miriam Berger]“3G has made our lives easier,” says Saleh, who now plans to expand Wajbaat both to other West Bank Palestinian cities and to other kinds of deliveries.

But Saleh, who studied business in the United Kingdom, faces other barriers that no amount of internet can overcome. He can’t easily extend beyond the Israeli-occupied West Bank, as his workers need coveted permits from the Israeli military to enter Jerusalem and beyond. The food, anyway, would likely spoil during the wait at checkpoints separating Israel and the Palestinian Territories. Periodic flying checkpoints and clashes between Palestinians and Israeli soldiers create a level of instability that apps can’t compute.

It’s the bitter and the sweet of 3G coming to Palestine: There’s so much potential–but old constraints remain.

“It’s hard to be excited about something that should have happened a while ago,” says Ambar Amleh, chief operating officer of Ibtikar, a fund that invests in early stage Palestinian companies. “But still it’s exciting as now we can do things like the rest of the world.”

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Israel captured the West Bank and Gaza Strip in 1967, areas Palestinians also claim as their own. Israel retains final control over frequencies allocated to Palestinian carriers under interim peace deals signed in the 1990’s, which created the semi-autonomous Palestinian Authority with limited self-rule in parts of these territories.

Since then, Israeli networks expanded to 3G in 2004 and 4G in 2014, while the West Bank and Gaza Strip remained on 2G. (Gaza, under blockade and ruled by the militant Hamas, still only has 2G access.) Negotiations to grant Palestinians 3G access had been going on for years but Israel had continually delayed actual implementation of a deal. Palestinians blamed Israeli authorities and companies for stalling in order to suppress Palestinian competition and development; Israel in return cited “security concerns” to justify not extending high-speed access.

In the meantime, many Palestinians work in Israel and Israeli settlements have spread in the West Bank, enabling some Palestinians to access 3G and 4G by buying prepaid Israeli SIM cards connected to towers in these settlements, despite the fact that the PA has banned Palestinians from purchasing Israeli SIM cards as a form of economic pressure.

[Photo: Miriam Berger]

While much of the world is now connected with high speed mobile, reliance on 2G Internet in Palestine meant that most messaging, and news and alert programs wouldn’t work. Israeli restrictions and competition have cost Palestinian cellular companies more than $1 billion in potential revenue just between 2013 and 2015, according to a 2016 report by the World Bank. The World Bank has also estimated that up to 30% of the potential Palestinian base in the West Bank was using Israeli companies for their 3G and 4G service.

It’s impossible to know how much of this money would have trickled down from the big businesses to average Palestinians. But 3G has now given Palestine’s tech community and many eager and educated entrepreneurs a new level of normal.

There’s Rocab, the Palestinian e-ride sharing service, which took the Uber model and tailored it to the Palestinian market. And others like Vatrin, which facilitates e-commerce, and Ipark, a parking app. With 3G, they now have a whole new potential customer base.

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In addition, Palestinians, facing political malaise amid frozen peace talks and internal divides, can now stay in touch a little easier.

“You are always connected,” says Shadi Ashtan, the director of Leaders, which runs Palestine’s first startup tech accelerator and mini tech park in Ramallah. “You can always get news. You can always get updates on what’s happening at Qalandiya [the main checkpoint between Ramallah and Jerusalem]. You can always know when there are clashes. Be in contact with your family.”

Still, there is a host of challenges, big and small, with which Palestine’s tech scene continues to struggle.

Entrepreneurs interviewed say the most immediate barrier remained that there’s no international payment gateway for facilitating money transfers. PayPal, which operates in over 200 countries, says it doesn’t work in the Palestinian Territories as it doesn’t meet the company’s service requirements, though it does work with Israeli banks and in Israeli settlements, which are illegal under international law. That means that app and internet-based companies still must largely rely on cash exchanges (credit card transfers fees are onerous), which is more cumbersome for both the client and business. Palestinian activists and businesspeople have launched several campaigns asking PayPal to change its policies–so far to no avail.

The Palestinian tech scene also remains hindered by limited exposure to other startup communities and opportunities for international exchanges because Israel limits the movement of Palestinians out of the West Bank and can limit the internationals that come in.

All of this has contributed to a brain drain of Palestine’s smartest entrepreneurs and leaders, who seek out better work, education, and living conditions abroad. Leader’s top three developers, for example, have taken jobs in Sweden and the U.S., says Ashtan.

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The current physical makeup of the West Bank–with Israeli settlements dotting the landscape and often dividing Palestinian communities–also means there are some parts where 3G also cuts out.

“We should be operating in all parts of the West Bank,” says Shadi Qawasmi, marketing communications director for Wataniya, one of the two Palestinian carriers that can now offer 3G. “But when you drive from Ramallah to Hebron, some parts don’t have coverage . . . we are not allowed to build our network wherever we want.”

Still, Amleh says that all these challenges also contribute to a uniquely Palestinian outlook that can be a benefit to startups seeking a creative eye.

“I think resilience is what describes Palestinians in this sector,” says Amleh. “And they are finding solutions to challenges that [other] people don’t even think of.”